This year's mobile payments conference was full of interesting insights on everything from CBDCs to CBD.
Topic #1: Open Banking
The U.S. is the only country with a market-led approach to open banking. In contrast, the E.U. is taking a more top-down approach where the government is an active participant and leader in driving innovation in open banking. Will Open Banking be similar to the way the telco industry was deregulated by the Telecommunications Act of 1996? We believe that there are benefits to both models. A more collaborative government stakeholder can help ensure that innovation is happening in a responsible manner. An informed government can provide checks and balances between industry and consumers.
Topic #2: CBDC (Central Bank Digital Currency)
Central Bank Digital Currency (CBDC) is still foggy in the U.S. How do we resolve the balance between consumers' increasing desire for privacy in their use of digital currencies, and the transparency necessary for things like fraud monitoring or worse, preventing funds from going towards nefarious individuals and organizations?
Topic #3: CBD
We were shocked to learn many things about the cannabis industry at this event. Cannabis Banking is very complicated to set up and manage. On average, for every 5 cannabis-related businesses (CRBs) that are added to a bank, the bank must hire one more compliance expert. This is extremely expensive and makes the business unprofitable. The effective tax rate for a CRB is also as high as 70%!
If you’re interested in learning how Apto can help your business navigate regulatory complexity, please reach out to us!
